honestly, it almost looks like it just changes the overall opacity of the image. i am curious though, i noticed that you have big round cyrcles that looks almost like they were done with the eraser tool. what exactly is it you did?

also, why didn't you just use a brush that would fade the egdes while creating the mask? would have saved you some time. *shrug*

PS: also, i am not sure what the differences are between photoshop CS and 7, as i am still using 7 myself and have yet to so much as see a running copy of CS.

i used the radial option of the gradient tool.. i wasn't aware you can do more in lesser time with the eraser tool.. dont' mean it in a wrong way but i think you're wrong
the feather will do the same thing and i'm not sure why you said the blur

before i start, this is for photoshop 7 as i haven't ever used cs so i don't know how different it is,

the only thing i can think of that may help is if you cut out the section you want to fade out, then paste it as a new layer, and apply the gradient to that layer,
although, for some reason, i sometimes am unable to apply a gradient on a selection with colour already in it so you may need to make a selection around the bit you want to fade out, then delete that part, then create a new layer(keeping the selection you made earlier in place) and then add the gradient to that selection.

This seems to make sense in my head, but if it doesn't to you I'll try and explain it better, as I am pretty sure this will do what you want, if it is a solid colour.

However, if it's an image, this may work,
create a new layer, then make a slection over the part you want to fade out, and create a gradient going from 0% opacity to your background colour,

i don't have a clue if this is what you are looking for but I hope it helps

masks work with black and white with anything in black being 100% masked and anything in white being 100% opaque and anything in between changing the mask opacity respectivly. now if you have your gradient from black to almost white (grey) the over all area will never be 100% opaque. check the white and make sure it's 100%. also, you can use complex masks with greys to do some cool masking.